So the wallet.dat file that is in the installation directory is the only file i will need to restore access to my wallet in case my PC burns or worse ?... 
Yes.I have also encrypted my wallet, but does that mean if my machine ever got hacked, i am 100% safe ?.. what to do for Maximum protection of my funds stored on my PC ?...
If your machine gets hacked and they get your wallet.dat file, they will need the password. But if you got infected with a trojan or keylogger, they may end up getting your password. In this case, they will have full control over your funds.I would say: don't get infected (don't download and run random files, use a good anti-virus, etc...).